VERGIATE, Italy --- Leonardo's Board of Directors, convened today under the Chairmanship of Gianni De Gennaro, approved the 2018-2022 Industrial Plan focused on long term sustainable growth of the Group. The Board of Directors examined the most recent estimates for the 2017 financial year (the definitive results will be examined for the approval of the Draft Annual Report on 14 March 2018) and approved 2018 Guidance.

The outlook in Leonardo’s reference markets is positive, particularly in international export markets. This underpins confidence in the opportunity for Leonardo’s core businesses.

Progress has been made in recent years building an effective “one company” operating and organisational model. But an acceleration is needed to ensure the sustainability of the business in the medium-long term, leveraging the "One Company", strengthening the business structure and enhancing the commercial approach.

The 2018-2022 Industrial Plan is therefore based on a transformation process that will be implemented in the following areas across the Group:

- Operating model Optimization ("Leonardo 2.0") through a central organizational structure able to coordinate the businesses action and to share/generate best practices, a stronger identity and a more integrated resources management;

- A more effective commercial strategy and customer approach, through a strong boost to international business development, customer support process, a cross-business customer support and an effective governance of technological innovation;

- Targeted Investments to support growth, focused on key products and technologies and the development of a new commercial network;

- A focus on cost control through a cost transformation program to support competitiveness of our products and reinvestment in growth;

- Product portfolio “Reshaping", including a focus on the allocation of capital to our core businesses, new potential partnerships.

Taken actions to address short-term issues in Helicopters business – underlining confidence in its strength

Leonardo Helicopters Division is a world-class business, with a strong product strategy. It has a range of market-leading products that have strong customer appeal, and which are taking share in attractive market segments.

The issues which affected 2017 performance are clearly understood and actions have been taken to change the organisation, its processes and its people. In improving markets, a clear plan is being executed to restore double digit profitability by 2020.

FY 2017 Guidance range reconfirmed
The results obtained in the first nine months of 2017 and the updated estimates for the last quarter suggest that the Group will deliver full year Revenues, EBITA and Free Operating Cash Flow in the lower part of the range of Guidance published in November 2017.

In respect of orders, in November it was flagged that the timing of the C27J order may move to 2018. As a consequence of this occurrence, 2017 orders are now expected to be €11.3-11.7 billion.

Alessandro Profumo, CEO of Leonardo, commented "After a challenging 2017 in which we re-set expectations, we intend to deliver an Industrial Plan to return Leonardo to long-term sustainable growth. We face attractive market improvement, we are taking actions to leverage off a new commercial strategy, we enjoy a strong backlog, and we know we can invest well for growth in enhancing further core products and technologies. We have taken actions to address short-term issues in our world-class Helicopters business. 2018 is a consolidation year, and we are confident we are laying the seeds for a new phase of sustainable growth with steady improvement in our top line, profitability and cash flow, to create value for of all the stakeholders of the company”.

2018-2022 Industrial Plan medium-term targets: Group sustainable growth in long term
The Plan envisages the achievement of the following targets over the next 5 years:
- 5 years 2018-2022 Order CAGR > 6%, with a book-to-bill equal to or above 1x
- 5 years 2018-2022 Revenue CAGR between 5%-6%, supported by new order intake and a strong order backlog
- Continuous improvement in EBITA, with 5 years 2018-2022 CAGR 8%-10% Return on Sales expected higher than 10% by 2020
- Accelerating FOCF accelerating from 2020 driven by order intake growth and increase in profitability
- Solid and flexible financial structure. We remain committed to a disciplined financial strategy, getting back to an “investment grade” credit rating and continuing to lower our cost of funding, while pursuing a balance between reducing leverage, sustaining investments for growth and adequate returns to shareholders.

Leonardo will present today at 2:30 CET in Vergiate (VA) the new 2018-2022 Industrial Plan.

Leonardo will present the FY 2017 results following the approval of the 2017 Draft Annual Report of the Board of Directors scheduled for March 14, 2018.